Blood cell development is orchestrated by the dynamic interplay between environmental cues and intrinsic genetic contents. However, the intracellular signaling mechanisms underlying regulation of hematopoiesis by extracellular signals are not well understood. The focus of this project is on deciphering Shp2 functions in control of hematopoietic cell development. Murine Shp2 is a cytoplasmic tyrosine phosphatase that was originally cloned by the applicant, and a main interest of this lab is to understand the fundamental cell signaling mechanisms involving tyrosine phosphatases. Work accomplished in the previous funding cycles has demonstrated a pivotal role of Shp2 in genesis of all blood cell lineages. This is the first example that a cytoplasmic tyrosine phosphatase promotes hematopoietic stem cell (HSC) commitment and differentiation. A general positive action of Shp2 in hematopoiesis defined by this lab has contributed significantly to most recent determination of a causal role of dominant active PTPN11/Shp2 mutants in child leukemia, leading to identification of PTPN11 as the first proto-oncogene that encodes a tyrosine phosphatase. The goal of this competing renewal application is to decipher biological functions of Shp2 in control of normal blood cell development in adults, using a conditional somatic gene deletion strategy. Our specific aims are: 1) to elucidate mechanisms by which Shp2 regulates adult HSC self- renewal, differentiation and homing, and also the HSC-niche interaction;2) to determine Shp2 action and mechanism in T lymphocyte development and functions;3) to determine Shp2 action and mechanism in B lymphocyte development and functions. We have generated new animal models and interesting preliminary data to support ALL three Aims. Completion of these studies will provide new insights into general mechanisms underlying coordinated regulation of HSC activities and specification/development of cell lineages in the hematopoietic compartment. Elucidation of Shp2 functions in normal hematopoiesis will also lead to a new paradigm that significantly advances our understanding of and fighting against leukemogenesis. PUBLIC HEALTH RELEVANCE: The proposed studies are aimed at better understanding of the molecular signaling mechanisms underlying normal blood cell development. Programming of hematopoietic cell development is orchestrated to a large extent by interplay between intrinsic genetic contents and environmental cues, such as cytokines and growth factors. However, relatively little is known so far regarding cell signaling molecules controlling genesis of blood cells. The focus of this project is on deciphering functions and mechanism of Shp2 tyrosine phosphatase, an enzyme that regulates protein phosphorylation and activities. Genetic lesions in the gene encoding this enzyme have been implicated in child leukemia. We will determine how Shp2 regulates self-renewal and differentiation of hematopoietic stem cells. We will also determine actions and mechanism of Shp2 in T and B lymphocyte development. Completion of these studies will not only lead to better understanding of how blood cells are produced normally but also provide new insights into how genetic mutations cause leukemia. Based on this type of knowledge, we will be able to develop new therapeutic strategies for leukemia, the deadly disease.